Mississippi, Maryland Advance Sweepstakes Gaming Prohibitions

• Both Maryland and Mississippi have advanced bills to ban sweepstakes gaming in their states
• The Maryland Senate unanimously approved a bill and advanced it to the House
• The Mississippi House of Representative approved a bill as well, but tacked on additional language that could hold up the legislation

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Legislation banning sweepstakes gaming is being advanced in both Maryland and Mississippi, as states continue to evaluate the legality of the form of gaming.

The Maryland Senate unanimously approved Sen. Paul D. Corderman’s (R-2) bill, SB 860, to ban online sweepstakes gaming and casinos by a 47-0 vote. It has been advanced to the House Ways and Means Committee where it will be heard on March 20 at 1 p.m.

The Mississippi House of Representatives also approved a bill to ban sweepstakes gaming and casinos, but additional language tacked onto the legislation may make it difficult to approve in the Senate.

Dual Currency at Heart of Sweepstakes Argument

Corderman’s bill seeks to ban online sweepstakes gaming, while also allowing the State Lottery and Gaming Control Commission to deny any individual or operator a gaming license or to continue to operate in the state if they accept revenue that is directly or indirectly connected to sweepstakes gaming.

A person who violates the new law will be subjected to a fine between $10,000 and $100,000, while also facing up to three years imprisonment.

Delegate Eric Ebersole (D-44A) introduced HB 1140 in the House as a companion bill to Corderman’s legislation. It was heard by the House Ways and Means Committee earlier this week, but did not receive a vote.

“Sweepstakes casinos claim to be sweepstakes contests, but are in fact unregulated and untaxed gambling,” Ebersole said at the hearing.

Both pieces of legislation define online sweepstakes games as those that “utilizes a dual-currency system of payment allowing the player to exchange the currency for any prize or award or cash or cash equivalents, or any chance to win any prize or award or cash or cash equivalents.”

They ban games that simulate casino-style games, such as slot machines, video poker, and table games, including blackjack, roulette, craps and poker. Additionally, they ban games that simulate lottery games, such as draw games, instant win games, keno, and bingo. They also prohibit games that simulate sports betting.

Maryland legislators have a better chance of approving legislation banning these games compared with similar efforts in Mississippi.

Mississippi Ban More Complicated

The Mississippi House of Representatives this week approved Senate bill SB 2510 to prohibit online sweepstakes games and sweepstakes casinos, but tacked on language to the bill to also legalize online sports betting in the state.

Sen. Joey Fillingane’s (R-41) bill, SB 2510, was approved by a 44-1 vote in the Senate this past February. His bill amends a state law to prohibit “any online, interactive, or computerized version of any game as defined in section 75-76-5 or any other game of chance or digital simulation thereof, including, but not limited to, online race books, online sports pools, and online sweepstakes casino-style games, is hereby declared to be a gambling device, and the offering for play or operating an online or interactive platform that offers for play such games within the state of Mississippi, shall be deemed unlawful under the provisions of this section.”

However, the House Gaming Committee last week inserted the language of house approved sports betting bill, HB 1302, into SB 2510, and also SB 2381, to keep online sports betting alive this session.

The Mississippi House of Representatives approved both Senate amended bills by a wide margin, with SB 2381 passing by a 107-3 vote and SB 2510 by an 83-19 vote. The bills have been sent back to the Senate for concurrence, but likely have little chance of approval.

With online sports betting language now attached to the Senate bill prohibiting online sweepstakes games and casinos, it casts doubt on the legislation’s chances. The Mississippi Senate, especially the Mississippi Senate Gaming Committee, has shown no appetite for online sports betting legalization this session.

Fear of online sports betting cannibalization and its effect on revenues for brick-and-mortar casinos in the state have led to stalled discussions in the Senate.